(”MLS Listings” are measured at one point in time, usually the 15th day of the current month. “Median Price” of homes sold and the total number of home “MLS Sales” are for the entire preceding month.)
Price (green line)
The median price in metro Phoenix of single family homes sold via the MLS fell to $118,000 in April 2009. The median home price in Phoenix, Arizona hasn’t been that low since sometime in the 1990’s. I only have data back to January 2000.
At $118,000, the median single family home price in metro Phoenix has fallen 55% from the peak median home price of $264,800 in June 2006.
I expected that the median home price would NOT fall from March to April however, it fell by $2,000. Nevertheless, that is the smallest such price decline since last April (2008).
We are searching for the bottom on median home price but it’s worth remembering that we know very well where the bottom was for the number of homes sold. The bottom for the number of homes sold in a single month was over a year ago in January 2008.
Sales (blue line)
Single family home sales in metro Phoenix AZ in April were incredibly high at 7,681 homes. That was the best month for home sales since September 2005 and was 68% higher than a year earlier in April 2008.
The surprisingly strong increase in sales from March to April, up 11%, suggests the market is so strong that the high season will stretch into June this year.
Listings (red line)
The number of single family detached homes listed for sale FELL an incredible 12% from mid-April to mid-May. The mid-May inventory is 32% less than a year earlier, in mid-May 2008.
The months of inventory in April of single family homes listed for sale was well within the “normal” range of inventory with the equivalent of a 5 month supply.
A year ago, in April 2008, we had a 14-month inventory. The inventory peaked at over 17 months in November 2007. Now, it’s 5 months.
Be aware that the supply situation varies tremendously within metro Phoenix depending on the geographic location and the price range of the homes you are looking at.
Conclusion
With the sharply declining inventory, next time the data is published we may finally see a month with NO decline in the median price of single family detached homes in metro Phoenix.
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Shift 05.16.09 at 10:02 am
I always like the market-at-a-glance plot.
Once the market stabalizes you are going to have a very nice supply-and-demand chart for phoenix metro.
John Wake 05.16.09 at 10:20 am
That red listings line is a text book example of a “head and shoulders” line. Maybe those stock technical analysts have something.
Rich 05.16.09 at 11:05 am
Interesting factoid: sales in terms of # of homes sold is up 68% y-o-y from April ‘08. Sales in terms of dollars spent on detached housing DOWN 12% y-o-y from April ‘08.
There may be a lot of houses being sold but the amount of dollars flowing into residential real estate is still near all time lows.
John Wake 05.16.09 at 1:52 pm
Rich, Looking at the real estate industry, some players get paid a more or less flat fee per transaction, for example, title, inspection and appraisal companies.
Realtors, however, usually get paid a negotiated percentage of the value of the homes sold. So within the real estate industry, the declining median home price hurts Realtors and real estate brokerages the most.
Lenders are somewhere in between Realtors and the others as far as how the lower median home price effects their gross revenue.
Lee Hasson 05.20.09 at 2:43 pm
I tend to concur with your view of the market. The inventory reduction should hopefully lead to a bounce or at least stabilization in median prices. It would seem imminent as investors seem to be making an entry back into the market. I’ve been discussing this on my site as well Real Estate Arizona. Let me know your thoughts.